The Farmer's Daughter USA

Hi, I'm Amanda! My family farms corn and soybeans in Southwest Michigan. I'm also a practicing attorney.

  • Home
  • Blog
  • Work with Me
    • Speaking
    • Giveaways
    • Social Media Consulting
    • Sponsored and Guest Posts
  • About Me
    • Media
    • Terms of Use

Our Family Farm Just Became A Corporation – And Yours Should Too

February 18, 2014

I’m proud to say that after several years of gentle pushing, I finally convinced my parents to take the plunge and incorporate our farm. As of January 1, 2014 we are now an official business. (Actually, we’re a limited liability company (or “LLC”), but for all intents and purposes the distinction is irrelevant. The point is — our farm is now officially a business entity!)

Of course, our farm is also still owned and run by our family, which might cause some confusion. People try to throw the word “corporate” around as though it’s a bad thing. It sounds far removed from family operations and has a negative connotation of industrialized farming.

Despite complaints to the contrary, 96% of American farms are family owned and operated, according to the USDA. So, don’t be fooled — a “corporate” farm can still be, and usually is, a family farm.

Why would a family farm want to incorporate? Here are just a few of the reasons:

Operating as a business entity provides liability protection.

Operating a farm leaves a lot of potential for something to go wrong. Farming is a dangerous profession and not only can the farmers get hurt, but so can the unwary public. Just moving our equipment from one field to the next could potentially be harmful to other drivers on the road — imagine if that trailer overturned!

However, forming a corporation or some other type of limited liability company allows farm families a level of protection from those types of mishaps. Although the farm could still be sued, the injured person should be limited to only getting damages from the farm assets, not personal assets. That means that our farm families won’t be thrown out of our house if something terrible happens, while still compensating the injured person.

Businesses may allow for better tax treatment.

On one hand, forming a business entity could also result in double taxation — the company’s income is taxed and then each person being paid by the company has their income taxed.

Many times, however, forming a business entity for the farm means nothing changes. Our entity will be a “pass through” for tax purposes, which really just means the income is treated as personal income for each year. In some cases, there may be benefits to filing as a company, rather than just an individual. It obviously depends on the way the business is structured and a tax specialist can help with those issues.

Forming an entity can make estate planning easier.

Normally, a farm is just made up of a bunch of assets — equipment, tools, land, seed, buildings, etc. That can be a nightmare for families transitioning from one generation to the next. Valuing each item and figuring out how to distribute it fairly can be tough. Not to mention that there is the potential for the farm to be split up into itty bitty non-profitable pieces.

With a business entity, the estate planning can be simplified, especially with farm and non-farm heirs. Now, shares of the farm can be distributed, rather than actual assets from the farm. That means that a non-farm heir can still inherit something without the farm being divided up.

If you’re a farm family operating as a sole proprietorship, it is definitely in your best interest to consider forming a business entity. I strongly encourage you to find a lawyer that specializes in agriculture law and speak with them about this issue. My family took that step and so should you!

signature
Share this:
«
»

Filed Under: Uncategorized Tagged With: corporations, education, family farms, legal, USDA

Comments

  1. Brigette Leach says

    February 18, 2014 at 2:27 pm

    Thanks for this! Totally agree that we should be changing from sole proprietorships to some form of corporation. We are in the process of protecting our personal assets AND facilitating estate planning with two LLC's. It just the way the world works that makes this necessary and you've provided a easy to understand explanation. Good job!

Hi, I'm Amanda. My family farms corn and soybeans in Southwest Michigan. I'm an attorney and I'm passionate about agriculture!

  • Email
  • Facebook
  • Instagram
  • Pinterest
  • Twitter
  • YouTube

Subscribe via Email

Archives

Latest on Facebook

The Farmer's Daughter

4 weeks ago

The Farmer's Daughter

You can't and won't make America healthy by blaming and hindering our family farmers.

... See MoreSee Less

MAHA Report delivers scathing assessment of farm pesticides | AGDAILY

www.agdaily.com

The new MAHA report, led by Secretary Robert F. Kennedy Jr., links pesticides to rising childhood illness, already drawing criticism from farm groups.

View on Facebook

·
Share



Share on Facebook



Share on Twitter



Share on Linked In



Share by Email

The Farmer's Daughter

1 month ago

The Farmer's Daughter

Do you a plan for your estate? My latest for AGDAILY focuses on potential changes to the federal estate tax.

... See MoreSee Less

Perspective: A farmer's legacy shouldn't be a tax nightmare for their kin

www.agdaily.com

For farm families, estate taxes aren’t just an abstract policy debate -- they’re a very real threat to generational farms and the livelihoods they support.

View on Facebook

·
Share



Share on Facebook



Share on Twitter



Share on Linked In



Share by Email

The Farmer's Daughter

1 month ago

The Farmer's Daughter

If nothing else, this should keep you up at night. Every snake oil salesman is now in charge of HHS.

... See MoreSee Less

How RFK Jr. Is Boosting ‘Food Babe’ and Other MAHA Acolytes

www.wsj.com

The health and human services secretary has elevated lightly regulated wellness companies and allowed advisers to keep investments, after vowing to end conflicts of interest.

View on Facebook

·
Share



Share on Facebook



Share on Twitter



Share on Linked In



Share by Email

The Farmer's Daughter

2 months ago

The Farmer's Daughter

These concepts aren't mutually exclusive.

... See MoreSee Less


Photo

View on Facebook

·
Share



Share on Facebook



Share on Twitter



Share on Linked In



Share by Email

The Farmer's Daughter

2 months ago

The Farmer's Daughter

Imagine getting to donate a substantial amount of money to a charity of *your* choice and you choose....an animal rights activist group with questionable intentions??

... See MoreSee Less

Why agricultural advocates are lashing out at Celebrity Jeopardy! | AGDAILY

www.agdaily.com

David Friedberg, founder of The Climate Corporation, is drawing ire for his "charity" of choice on Celebrity Jeopardy!: Humane World for Animals.

View on Facebook

·
Share



Share on Facebook



Share on Twitter



Share on Linked In



Share by Email

Latest on Instagram

Amanda Zaluckyj

thefarmersdaughterusa

Amanda | The Farmer's Daughter USA
I'm a proud farmer's daughter & advocate for modern agriculture. U.S. farmers are leaders in sustainability.

Perusing my photos from #Denmark and getting the i Perusing my photos from #Denmark and getting the itch to travel again.
These concepts aren't mutually exclusive. #farms # These concepts aren't mutually exclusive. #farms #farmfamily #environment #soilhealth #nutritiousfood
Stop worrying about labels and just eat them! Stop worrying about labels and just eat them!
Corn is a powerhouse! #corn #farming #growcorn # Corn is a powerhouse! 

#corn #farming #growcorn #USAGrown #usagriculture
Happy St. Patrick's Day! 🍀 Happy St. Patrick's Day! 🍀
The blood moon. 🌙 And proof I woke up at 2:15 a The blood moon. 🌙 And proof I woke up at 2:15 am to see it!
3 years. 💔 #slavaukraini #supporukraine #ukrai 3 years. 💔

#slavaukraini #supporukraine #ukraine #glorytoukraine🇺🇦
Mischa will not suffer a snowman in her yard. ❄️☃️

#dogslife #dogsofinstagram #blacklab #pittiemix #snowday #snowman
We all know RFK, Jr. is well known for vaccine dis We all know RFK, Jr. is well known for vaccine disinformation. But he's also a danger to agriculture, even promising to "weaponize" regulatory agencies against our farm families.

#rfk #farmersdaughter #farmers #conspiracytheories #puremichiganfarm #rfkjr
Load More... Follow on Instagram

Copyright © 2025 · Website Design By Jumping Jax Designs